Posts Tagged ‘India’

Indian oil subsidies have an impact way up the supply line

India’s financial reporting season never fails to remind us of the fragile state of the country’s state-owned oil marketing companies whose profits swing wildly from quarter to quarter. Those moves are not for any fundamental reason, but because they may or may not have been reimbursed by the government for losses incurred from selling diesel, LPG and kerosene at below market prices.

But these companies — Indian Oil Corp., Bharat Petroleum Corp. and Hindustan Petroleum Corp. Ltd. — are usually fully compensated by the end of the financial year, which runs from April to March in India.

Until they get compensated, they rely on market borrowings to fund their operating expenses and the longer the non-payment period, the higher their interest costs on these borrowings. But the bottom line is that they get compensated.

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In two Asian countries, the road to higher retail oil and natural gas prices

The plan was to focus this blog entry on the big news out of Indonesia last week: the first fuel price hike in five years. But another more interesting bit of news emerged in the last 24 hours and I feel compelled to at least mention it.

This is the Indian government’s long-awaited decision to double gas prices. The common theme to both price hikes is that sometimes, economics does have the power to overtake politics.

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The pressure on Iranian oil exports: this week’s scorecard

The week is only about 3/5 over, but there already have been numerous developments regarding the West’s continuing pressure on various countries, mostly Asian, to either cap their Iranian purchases at prevailing levels, or reduce them.

Here’s a quick summary of what’s transpired in the past few days, based on reporting from a wide range of Platts’ staff members: Takeo Kumagai, Pradeep Rajan, Mriganka Jaipuriyar, M.C Vaijayanthi and Charles Lee.

If there’s one conclusion that can be drawn from these various reports, it would be this: earlier conventional wisdom that Iran would simply transfer the oil from cancelled EU sales into its Asian customers is looking woefully wrong.  (A summary report of where events stood last week can be read here.)

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Here’s a suggestion in the fight again piracy: shun one-upmanship

Rain or shine, it is business as usual for the Somalian pirates, as seen by the recent attempted hijacking of the fuel-oil laden Brillante Virtuso, a Liberia-flagged Suezmax vessel.

The attack, taking place at a time when the monsoon is at its peak in the Gulf of Aden and the surrounding region, saw a fire break out near the tanker’s accommodation block as a result of RPGs fired at the vessel.

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At The Wellhead: a spat over India’s giant offshore gas field

In this week’s Platts Oilgram News At The Wellhead column, Mriganka Jaipuriyar of the Platts’ Singapore office discusses India’s KG-D6 field, how it was supposed to be an enormous source of energy for India, and how things have gone wrong since its launch.

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Cairn-Vedanta stuck in Indian bureaucratic impasse

No one in India seems to want to be the one to make a decision on the $9 billion Cairn-Vedanta deal.

Eight months after Cairn Energy announced its intention to sell its stake in Cairn India to Vedanta Resources, the fate of the deal still hangs in balance.

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CERA on Thursday: Rowe’s speech gets a caution flag

With power being the focus of Thursday’s CERAWeek sessions, participants are aggressively debating the role of natural gas vs. coal in the power mix, not just today, but going forward.

Questions center around how best to obtain the fuel resources and how to manage grids.

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India should lead fight against piracy in Indian Ocean, Arabian Sea

The hijacking of supertanker Irene SL and Aframax tanker Savina Caylin in a spate of two days last week will pose some questions on various navies patrolling the vital sea-routes in the Indian Ocean and Arabian Sea.

    

And one of them that needs to come up with some satisfying answers is the Indian Navy. There’s been a series of attacks on the ships steaming in areas which are just 350 nautical miles off India’s west coast since 2009, while New Delhi boasts of having the world’s fifth largest navy.

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Cutting the cord: wrestling with subsidized oil prices

It was said in 2008, when oil prices reached their all-time high, that the only countries that showed an increase in oil consumption that year were those that capped prices or subsidized them to some degree. With prices rising again, though still a long way from the 2008 peak, those subisidies are once again becoming an issue in many countries.

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Shale gas to rock the Indian energy scene? Some say yes, but…

Every now and then, the world needs a new icon to worship. And in the energy sector, that now is shale gas. ”Exciting,” “promising,” “game-changing” and “rocking” are some of the adjectives used to describe it.

Though digging through shale for oil and gas began more than 100 years ago, it has only recently become something that people flock to, not very different from the gold rush of days gone by. Looking at the success of the US, where shale gas is expected to rise from 42% of total gas production to 64% by 2020, the whole world is looking at shale with new eyes. Australia, Europe, China and India are all looking to shale to deliver their own golden eggs. But is it really possible to duplicate the success seen in the US elsewhere in the world?

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